The determinant of China’s crude oil import preference has mainly been based on the pricing discount they can achieve as Russian barrels remained cost-competitive. China’s crude import has been largely driven by prices on the delivered basis, which explains the significant jump in volumes from Russia and other unconventional exporters. Imports from others including OPEC and non-OPEC countries in the Middle East, West Africa, North and South Americas moved sideways since 2021 (grey area in the left graph), with this volume further sliding in 2024 amid pressured refining margins and runs reported by state-owned oil majors. Geo-events and ...
West to East Russian Crude & Fuel Oil
Nov. 8, 2024
West-to-East cargo flow, which has been dominated by Russian exports to the East, simultaneously trending lower in 2024 for both crude and refined products. On the crude side, exports to Northern Europe saw a notable decline since Russia’s invasion in Ukraine, while Far East and India rapidly increased their intake of Russian crude since then. These export levels expanded further after the Price Cap being adopted; however, exports to the Far East (predominantly exports from the Baltic and Black Sea to China), significantly retreated since the Red Sea disruption. Despite Houthi promises not to attack Russian and Chinese ships ...
Hormuz Strait CPP Analysis
Nov. 1, 2024
In a Hormuz Strait closure scenario, the CPP market would be materially affected as there are no logistically viable options for CPP tankers to bypass. Therefore, we anticipate all CPP exports will be diverted to other supply regions in the “Strait Disruption” scenario, adding a net of 62 MR2 demand equivalents. Based on our AIS tracking data, we have captured on average 2.47 million b/d of clean refined products sailing from the Arabian Gulf in 2024 through the Hormuz strait. Unlike crude or NGL exports, there is no operational pipeline in the Middle East to bypass the Hormuz ...
